WORK PROBLEM

Otago Daily Times, Issue 23648, 4 November 1938, Page 9

WORK PROBLEM

PLANS FOR THE FUTURE EMPLOYMENT PROMOTION NEW STATE ORGANISATION DETAILS NOT DISCLOSED < Special to Daily Times )' AUCKLAND, Nov. 3. In view of (he statement made on Tuesday by the Minister of Labour, (Mr H. T. Armstrong) that the Government is discussing the formation of a new organisation to deal with the able-bodied unemployed when the present Employment Promotion Fund goes out of existence next year, there is a fairly widespread belief that employment promotion activities in future are likely to be even more closelv linked with public works schemes. An extremely optimistic view of the unemployment situation is taken by l.ir Armstrong, who. in his statement, put forward the opinion that long before March 31, when contributions to the Employment Promotion Fund will cease, private employers will need all the men at present working under subsidies from tha* fund. The Minister added, however, that,-the new organisation at present being considered bv the Government would see that any surplus of fit unemployed men would not be left without work. Question of Policy In a telephone conversation vith the New Zealand Herald yesterday afternoon Mr Armstrong was asked to amplify his tatement concerning the new organisation for employment promotion and, in particular, was asked to give some indication of the steps to be taken with regard to men who are at present in subsidised employ lent. His reply was that the matter was one cf Government policy which he was unable to discuss at the moment. Other questions put to Mr Armstrong concerned the number of men whose wages at present are subsidised from the Employment Promotion Fund and the future activities of the State Placement Service. The Minister said he did not have the exact figure of subsidised workers, as his department was not in the habit ~f furnishing returns every 24 hours. As for the State Placement Service, it would definitely be fitted into the new organisation. Existing Expenditure In the absence of official figures it is impossible to say how many men are in receipt of wages subsidised from the Employment Promotion Fund, but the *etums for August and September disclosed that during four-weekly periods, expenditure from the fund under the heading of employment promotion, as distinct from relief expenditure, totalled £377,572 and £491,636 respectively. This is indicative of the extended use which has been made of the proceeds from the existing wages tax to pay the wages of men who would otherwise be classed as unemployed, ' Illuminating figures regarding expenditure from the Employment Promotion Fund were quoted in the House of Representatives last session by Mr J. G. Coates. Allegations of a Government “ raid ” on the fund were made by Mr Coates, who said that various departments were obtaining from the Employment Promotion Fund credits totalling £483,000 which normally would have to come from the Consolidated Fund. Similarly, additional credits totalling £845,000 were being provided for public works. The figures quoted by Mr Coates concerned the .estimates of expenditure for the current financial year. Future Requirements In reply to Mr Coates’s arguments Government speakers contended that departmental credits were being obtained from the Employment Promotion Fund largely to cover the wages of additional men for whom employment had been found. No answer was given to Mr Coates’s further query, however, as to how the money is to be obtained to pay these wages when the Employment Promotion Fund goes out r\f ftvicfpripp '*■ 1 In addition to-work found by the Government within the various departments of State, full labour subsidies are paid from the Employment Promotion Fund to local bodies in respect of men engaged for approved works at standard rates of pay. It has been estimated that there are 2300 such men employed by Auckland local bodies alone. Many of the local body schemes which carry unemployment subsidies from the Government are of comparatively short duration, and are likely to be completed before the fund from which the men are paid goes out of existence, Work will, however, still have to be found for these men, and if they are not absorbed in private industry the financial responsibility will rest with the Government, which, so far, has made provision for only £1,500,000 in annual unemployment sustenance payments from the Social Security Fund. Problem of F‘ ance The emblem appears to be very largely one of finance, but, from indications which have been given by the Prime Minister (Mr Savage) and others, it appears that the Government propose to approach it from the angle of drafting fit unemployed men to public works Mr Savage has suggested that the ultimate aim will be to organise public works activities in such a manner that men will be drafted to and from seasonal employment in the country districts The position at the moment is that the proceeds from the existing wages tax at 8d in the £ will be paid into the Employment Promotion Fund until March 31. together with the November and February instalments of the levy and emergency charge on income other than salary or wages. Accordingly there should be a fairly substantia] balance in the fund at the start of next financial year, but with no new revenue coming in. the balance will probably be expended before the fund goes out of existence on September 30. Unless there i? a sudden and marked increase in the demand for labour by private employers, the Government thereafter will probably have to find about £3,000,000 of new money annually to maintain the labour position as it is at present.